Yield Seeking, Adult Toys and Chinese Birth Rates

It has been a busy two weeks around Chez Melvin since I last sent out a Thursday note. Between the trip to Atlanta for the FIG Bank Conference and the weekend venture down to Sanibel for our anniversary, I was on the road and out of the loop quite a bit. One of the nice things about the way I invest is that I don’t have to be in the office every minute watching every tick and trade. When you are a long term holder of stocks the minute by minute is hardly crucial, freeing me up once in a while for more important activities.

The Atlanta Conference is always one of my favorite trips of the year. The bankers I spoke with this year were pretty upbeat about the prospects for their banks and the industry as a whole. Net interest margins are still a big problem but credit conditions are still excellent, and loan demand is steady, especially in urban markets. M&A is still the best path to growth, and the fact that rates are not rising anytime soon is forcing more banks to consider selling their bank. Rising technology costs are also a factor in the sell decision. You have to have all the digital and mobile bells and whistles are a must to compete in all but the most rural markets and they are expensive. If you can’t spend the money, you have to sell the bank.

The flip side of that coin is that the banks that are buyers are gaining the scale they need to invest in technology. Not only does this attract and retain customers but the right technology package allows banks to streamline operations and reduce costs. More mobile offerings and a high acceptance rate among customers are allowing some ...

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Time Frames, Dangers and Economic Obstacles

I will kick off this week with some highlights from the Delivering Alpha Conference this week. A lot of smart people spoke this year, and they said a lot of things worth considering. I really liked what Marc Lasry of ...

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Recreational Reading, Morons and Semi-Degenerate Gamblers

The week has been a fairly quiet one. The Orioles have played their way back into contention dn are only a game and a half back of the division leading Red Sox. We have a weekend series with the Tigers ...

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Recreational Reading, Morons and Semi-Degenerate Gamblers

The week has been a fairly quiet one. The Orioles have played their way back into contention dn are only a game and a half back of the division leading Red Sox. We have a weekend series with the Tigers ...

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Flying Blind, Undated Call Options and Emmylou

Frank Martin of Martin Capital recently penned a shareholder letter to investors in His Hummingbird Value Fund and as always his thoughts are a worthwhile read. If you have ever read it his book A Decade of Delusions: From Speculative ...

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Interest Rates, Psychology and School days

We had a release of the Fed minutes this week and the meetings are getting a bit livelier. Some members think we need to raise, some want more evidence and some just aren’t that sure what to do. Much ...

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Eggheads, Bankers and Gershwin

The dog days of summer are upon us. Here in Central Florida we are at the point where the dog gives me that “You are a special kind of stupid aren’t you?” look when I try to interest her ...

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Low and Slow, Prudent Buyers and Barefootin

We continue to see a mixed bag in the US economy. For every good number or comment we see a negative development or commentary. For instance Jamie Dimon was pretty upbeat about the US economy recently saying “"What we see ...

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Low and Slow, Prudent Buyers and Barefootin

We continue to see a mixed bag in the US economy. For every good number or comment we see a negative development or commentary. For instance Jamie Dimon was pretty upbeat about the US economy recently saying “"What we see ...

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Bank CEOs: M&A is on the way

Imagine going out to coach the Super Bowl with the other teams playbook in your possession. You will have a huge edge over the other team and your odds of victory will skyrocket because you know exactly what the other ...

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Bank CEOs: M&A is on the way

Imagine going out to coach the Super Bowl with the other teams playbook in your possession. You will have a huge edge over the other team and your odds of victory will skyrocket because you know exactly what the other ...

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Private Equity, Banks, Political Parties and Steamed Crabs

There was no Thursday note last week as after several weeks of contractors and noise the wife and I decided we had had enough. The youngest was in Ireland seeing her fathers family so we left my son with the ...

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